Answering Some Affordable Care Act Questions

One listener named Will wrote in saying that when he signed up, he didn’t appear to be eligible for a subsidy, even though he believes he is. There are also reports of individuals getting insurance cancellations notices due to the Affordable Care Act.

Julie Appleby of Kaiser Health News joins Here & Now’s Robin Young to sort through some of the questions.

Guest

But let's take up some of the questions that we just heard on a national level with Julie Appleby. She's senior correspondent for Kaiser Health News. And Julie, start with people being told by insurers that their current plans don't meet the requirements of the Affordable Care Act, that they have to get new ones. You've been reporting on this. How widespread is this?

JULIE APPLEBY: Remember, I mean, this is affecting folks who buy their own coverage in the individual market, and there's about 14 million or so Americans who currently have coverage in the individual market. We don't know how many of those are getting cancellation notices, but we do know that hundreds of thousands of people are because we spoke with a number of insurers, and we totaled up some of those numbers.

And insurers are saying that they have to cancel some of these because they don't meet the requirements of the health law.

YOUNG: Such as mental health treatment, maternity care? What are some of the things that they don't have?

APPLEBY: Right, all new plans starting on January 1st have to cover things like maternity care, mental health and substance abuse treatment, prescription drugs. Their deductibles and co-payments and things like that can't exceed certain out-of-pocket maximums. So they're saying that a lot of these policies that they are canceling don't meet those standards and that people do need to sign up for a policy that does meet the standards.

YOUNG: Well, this is angering people who thought that President Obama was saying to them they would not have to change their health plans under the new law. Many of them now are. But what's the sense of whether or not they're going to get better coverage?

APPLEBY: You know, that's a lot in the eye of the beholder, right. We are getting emails from people who are saying, you know, I really liked my old policy, I liked it even though it had a $10,000 deductible. Now I have to buy a plan that yes, it has a lower deductible, but I'm going to spend more in premiums.

Other folks may find that the cost could be less with a subsidy, because remember the subsidies also begin January 1st for people who make less than 400 percent of the federal poverty level, which this year is about $46,000 for an individual. So for some people the premiums may be less.

But it's going to be a different plan, and people weren't expecting necessarily to have to change to a whole new plan.

YOUNG: Why did this happen? Did the crafters of the Affordable Health Care Law not realize how many companies were not up to snuff?

APPLEBY: I think what folks were concerned about in Congress is that many people are what they considered under-insured. Perhaps they had a policy with a $20,000 annual deductible, or maybe the policy didn't cover hospitalization. So I think Congress was trying to set a certain floor of benefits. And the flip side of that is how it affects premium prices and other things.

YOUNG: Well, I just want to be clear because you and your colleague Anna Gorman, and by the way the Kaiser Health News writers have been terrific on following all of this, you conclude that by all accounts the new policies will offer consumers better coverage and in some cases for a comparable cost. You say of course that's not always true, but by and large it is?

APPLEBY: By and large this is what proponents are saying is that this coverage is broader, it's more comprehensive than what was offered before. Now remember a lot of people were buying policies that didn't cover much at all. We did a study a while back, a survey of some of the plans that were available online. We found that nearly one-third of the plans being offered to consumers who buy their own coverage had out-of-pocket costs that exceeded $6,300 a year for an individual or $12,700 for a family, which are the new limits.

So in that case, people were buying these plans that perhaps left them exposed to tens of thousands of dollars in costs. Now for some people these policies are going to be more robust, they're going to cover more things.

YOUNG: Well, we know Trader Joe's, for instance, has told many of its part-time employees that those employees will now no longer be covered because they don't work the number of hours that is required to cover them, and so they're pushing them toward the exchanges with a $500 check to spend but also saying that you are more than likely going to get a better deal there because of the federal subsidies for people who are low-wage workers.

So in some cases, people will get subsidies on these exchanges that they wouldn't have had in the private plans.

APPLEBY: Right, it's interesting. Some of the experts I've interviewed said that some workers may actually be better off if their employer does drop their coverage and send them to the exchanges, and these would be the lower-income workers. Now the lower-income workers would have to qualify for a subsidy, and that subsidy may offset a large part of the premium cost for them.

YOUNG: Julie, that brings us to a question we got from Will and Linda Forsburg(ph), in Healy, Alaska. Now, they say that they went online very excited about Obamacare. They're relatively low income. They signed up early on, but they were told that they were not eligible for tax credits. They believe that they are, and their question is: Can you re-sign up if you think that actually because of computer problems you didn't get the subsidies you should have?

APPLEBY: You know, I'm not sure exactly the answer to that question. I had heard that once you hit the enrollment button, you are enrolled, and once you've paid your premium, you are enrolled. Now if they haven't paid their premium yet, they might want to wait and then re-enroll.

Now here's what they can do with the tax credits. From what I understand, you have a choice. You can either take it as an advance tax credit, and then that money is sent directly every month to the insurer, or you can take it later as a tax credit when you fill out your tax returns, and if it looks like yes, indeed, you should've qualified for a subsidy, there is a way you can qualify then for the tax credit when you're filling out your tax papers.

YOUNG: And there is an appeals form in the login process, and he filled that out and mailed it off. So he might get the same information back.

APPLEBY: Right, yeah.

YOUNG: And one last question. You're reporting that some insurance companies, this is Independence, Highmark, are canceling something called a guaranteed issue policy. This is for customers for pre-existing conditions. Now we know that under the new law you can't refuse a policy to someone because of pre-existing conditions, and you've also told us that in some states, there are companies that were designated to cover people with pre-existing conditions.

So what is this all about, this cancellation of some policies?

APPLEBY: Right, in Pennsylvania and a few other states, some insurers had to take people with pre-existing conditions. In most states, they were able to reject those people. But in Pennsylvania, where these policies are being cancelled, they say they are removing all these guaranteed issue policies. But the insurers say they're doing so because these policies do not cover all the things that the federal health law will require them to cover.

And they say that they are welcoming these folks to come and re-sign up with a new plan with them.

YOUNG: So it's the same thing we've been talking about, the idea that oop, this policy doesn't qualify under the law, we're going to have a new policy, we need you to switch to that.

And one more health care note. Coming up later on ALL THINGS CONSIDERED, more information about a contractor working on healthcare.gov, it's an IT outsourcing company from Canada. That's later on ALL THINGS CONSIDERED. You're listening to HERE AND NOW. Transcript provided by NPR, Copyright NPR.